WASHINGTON—The Securities and Exchange Commission prevailed Tuesday in a key stage of its cryptocurrency enforcement crackdown, as a federal judge issued an injunction halting Telegram Group Inc. from distributing its digital coins.
U.S. District Judge P. Kevin Castel wrote the SEC had shown a “substantial likelihood of success” in prevailing against Telegram, which was accused of breaking investor protection laws when it sold $1.7 billion in cryptocurrency.
Dubai-based Telegram and other startups pushed forward with lucrative,...